Papers Relating to the Foreign Relations of the United States, With the Address of the President to Congress December 4, 1917

The Danish Minister to the Secretary of State

Danish Legation,
Washington, April 18, 1902.

Mr. Secretary of State: By direction of his excellency the Danish Minister for Foreign Affairs I have been instructed to unofficially call your excellency’s attention to some errors in connection with the Convention of January 24, 1902 for the cession to the United States of the Danish West Indies, which appear in the report on this subject of the Committee on Foreign Relations of the United States Senate called Report No. 1. Executive. To accompany Executive M. 57th Congress, first session.

This report says on page 13:

The object of the closing provision of Article 1 is to discharge the insular treasury and the Government of the United States from all liability by reason of the nonpayment of the guaranteed interest.

And again a few lines below:

No responsibility or obligation of any kind rests on the Government of the United States or on the insular treasury in connection with the St. Croix Sugar Company.

This is evidently an entirely erroneous interpretation of the last part of Article I of said convention, in which it is said:

No responsibility of any kind whatever is incumbent on the Danish Government, nor on the United States Government, as to the guaranty which, conformably to the ordinance of June 16, 1876, the colonial treasury of Saint Croix has assumed with regard to the payment of an interest of five per cent per annum to the holders of the shares of the “Sainte Croix Fallessukkerkogerier” Company Limited, while this article does not say and cannot in any way be understood to suggest or involve that the Colonial Treasury should after the cession be held to be discharged from all liability by reason of the nonpayment of the guaranteed interest.

That no responsibility or obligation of any kind rests on the insular treasury in connection with the St. Croix Sugar Company is just the contrary of the real situation in regard to the guaranty of the insular treasury towards the shareholders. It was also distinctly admitted from both sides during the negotiations, that the liability for said guaranty would remain with the insular treasury of Sainte Croix, and it was for this very reason that the words “except as stipulated in the present Convention” were inserted in Articles I and V after the words “in full sovereignty, entire and unincumbered.”

The report also says:

In point of fact, the unfulfilled guaranty of the insular treasury could not subsist as a valid claim in favor of Denmark.

These words appear to suggest the supposition, that the nonpayment by the colonial treasury to the shareholders of the guaranteed interest should result in a claim on the colonial treasury in favor of the Danish Treasury, a misunderstanding which is inexplicable to my Government.

The report appears finally as an argument for the opinion, that the colonial treasury would by the convention be discharged from all liability by reason of the nonpayment of the guaranteed interest, to refer to a note which I had the honor to address to your excellency under date of November 23, 1901 and in which I said:

The guarantee of 5 per cent interest per annum, which, according to the above, is incumbent on the colonial treasury of St. Croix in regard to certain shareholders, will cease as soon as the Danish Government has acquired the ownership of the mortgaged property of the Fallessukkerkogerier by execution sale, because, in accordance with the ordinance of June 16, 1876, this guaranty should only last until the loan given by the Danish Treasury was liquidated.

I am instructed to call the attention of your excellency to the fact, that this, of course, was only meant to express, that the guaranty in question would cease for the future, while the claim of the shareholders in regard to the guaranteed interest due before the liquidation would remain in force. It was at the time thought unnecessary to add the words “for the future” to the word “cease”, as no misunderstanding seemed possible on this point.

In directing me to call the attention of your excellency to the above-named points, it is of course far from the intentions of my Government to in any degree criticize the report of the Foreign Committee of the Senate, but the expressions used in this report have given rise to the fear, that an erroneous understanding of the same points might subsist or arise in other quarters, and it is my Government’s wish to prevent every possibility thereof by seizing this opportunity to call attention to the right interpretation of the Convention.

I have [etc.]

C. Brun

Department Memorandum

The note of Mr. Brun, the Danish Minister, brings to the attention of the Department the last paragraph of Article I of the Treaty of Cession to the United States of Danish islands in the West Indies, with reference to the question what effect said paragraph may have upon any obligation the colonial treasury of St. Croix may have assumed with regard to the payment of an interest of 5% per annum to the holders of the shares of the Saint Croix Fallessukkerkogerier Company, Limited.

“It is not allowable to interpret what has no need of interpretation,” and therefore it is evident that Mr. Brun’s note is entirely correct in stating that

This Article (I) does not say and cannot in any way be understood to suggest or involve that the colonial treasury should after the cession be held to be discharged from all liability by reason of the payment of the guaranteed interest.

His statement is also correct that under the treaty of cession, whatever liability existed against the insular treasury in connection with the Sainte Croix Sugar Company prior to the cession would remain with the said treasury after the cession.

From the foregoing it follows, as a matter of law, that the guaranteed creditors will retain their remedies, after the cession, fully and precisely, as they existed prior to the cession except so far as is expressly stipulated in the treaty to the contrary; and the contention of Mr. Brun in this sense is undoubtedly correct—that the guaranty would subsist against the colonial treasury until the loan and guaranty were liquidated, when the guaranty in question would cease for the future.

The treaty in question is to be interpreted and carried into execution by the Executive Governments of the high contracting parties; but in respect of the provision of the treaty to which Mr. Brun’s note is addressed, the meaning is so clearly expressed, as already indicated, that there is nothing to interpret.